Why the stock market is falling today: Sensex cracks over 700 points, Nifty slips below 25,200; 3 reasons behind the fall

Indian benchmark indices Sensex and Nifty50 fell sharply on Friday, dragged down by weaker-than-expected earnings from Tata Consultancy Services (TCS), renewed trade tensions after fresh US tariffs on Canada, and concerns around potential sanctions on Russia.

The BSE Sensex tumbled over 700 points to trade below 82,500, while the Nifty50 declined over 200 points to drop below the 25,200 level. The total market capitalisation of BSE-listed companies dropped by Rs 3.03 lakh crore to Rs 457.22 lakh crore.

Across sectors, the Nifty IT index fell 1.6%, led by losses in TCS, Infosys, and Wipro. Auto and Oil & Gas indices slipped over 1%, while Financials and PSU Bank indices were down more than 0.5%. The Nifty Midcap100 and Smallcap100 also shed nearly 1%.

Why is the market falling?

1. Weak Q1 Earnings from TCS

The broader market turned cautious after TCS’s Q1FY26 results failed to meet revenue expectations. The stock dropped as much as 2.5% to Rs 3,297 after the IT major reported a 6% YoY rise in net profit to Rs 12,760 crore—slightly above estimates—but posted a 3.1% YoY decline in constant currency revenue.

With clients delaying discretionary tech spending amid global uncertainty, brokerages trimmed earnings estimates for FY26. The sentiment also spilled over to other IT majors. Infosys, Wipro, LTIMindtree, and Tech Mahindra fell between 1-3%, dragging the Nifty IT index 2.1% lower.

2. Trump’s New Tariff Plans Worry Investors

US President Donald Trump announced a 35% tariff on imports from Canada starting next month, while hinting at 15%-20% blanket tariffs on other major trade partners. The move stoked fears of a broader trade war, hurting global investor sentiment.
Following the announcement, Nasdaq and S&P 500 futures fell about 0.4%, while EUROSTOXX 50 futures also declined 0.4%. Earlier this week, Trump had postponed some tariffs to August 1 to allow for negotiations but expanded duties on key allies including Japan and South Korea.

3) Oil Rises on Possible Russia Sanctions

Adding to the volatility, oil prices edged higher after Trump said he would make an announcement regarding Russia, raising speculation about new sanctions.

Brent crude rose to $68.83 a barrel, while US WTI crude surged to $66.81. The anticipation of tighter supply pushed oil prices higher, although gains were capped by concerns over rising OPEC+ output and ongoing trade-related uncertainty.